Use keywords in ad text
Show the searcher that your ad is relevant.
Google will display the search keywords in bold in your
ad if they're present. This helps your ad stand out
from the crowd.

Keep ad group keyword list short
Instead of having a single ad group with a large list of keywords,
create many ad groups, each with a short list.
This will help you achieve tip #1.

Bid high initially
Google's ad system determines placement by both bid and CTR
(click through rate). To earn a high CTR, you first need
to generate some clicks. Bid high initially so your ad is
seen early in the search results. Once you have a high CTR,
lower your bids.
Read this article
for more information on bidding strategies.

Set daily budget higher than Google recommends
If you set your daily budget too low, your ad will be displayed intermittently.
This is not what you want. You always want your ad to be shown when
someone searches for your keywords. Control your ad spend through
other means such as employing negative keywords, using exact
matches, targeting by region and adjusting keyword bids.

Avoid bidding wars
Don't waste money getting into bidding wars for a handful
of high volume keywords. Instead, expand your keyword list to
include more specific keywords that have a lower search volume.
Collectively, these keywords will reach the search volume
of more expensive keywords. Your average CPC (cost per click)
will fall dramatically using this tactic.
Use keyword research tools
to expand your list of keyword phrases.

Set higher bids on exact matches
Include both broad and exact matches for a keyword phrase.
Set the bid higher for the exact match.
This allows you to control the position of the ad
for the exact search.
For example, if your ad group bid is set to 10 cents,
you might set a 25 cents bid for the exact match:
[keyword phrase] ** 0.25
keyword phrase
Read this article
for more information on exact match bidding.

Use negative keywords
Your ad will not be displayed if the search includes
a negative keyword.
Add more negative keywords at regular intervals.
As your negative keyword list grows, your ad group's CTR
will increase, saving you money and/or improving your ad's position.
For example, if you sell products or services at a premium,
include negative keywords like:
-free
-cheap
-discount
Read this article
for more information on negative keywords.

Use a relevant landing page
For most searches, don't point the ad to your home page.
Choose a landing page on your site that includes the keywords
from the search. In some cases, it's worth creating
a custom page that's not in the normal navigation of your site.

Separate search and content campaigns
Many people lose money using AdWords when their site is
swamped with hits from content ads.
Most people don't realize that displaying ads on Google's
content network is turned on by default.
Either turn off the content network or create
separate campaigns for search and content ads.
Read this article
for more information on Google's content ads.

Test multiple versions of ad
Take advantage of Google's feature allowing multiple ads to
be created and rotated within a single ad group.
Test different ad text and see which version works best,
both from an ROI and CTR perspective.
A better ad will lead to a higher CTR and lower bids for the same ad position.

Track your results
Don't rely on Google's reporting tools. They're good, but you need
more detail, particularly to see which actual keyword phrases
your broad matches are triggering. You'll need this to help build
your list of negative keywords for each ad group.
Plus, click fraud is a problem and needs to be addressed.
If you don't have tracking software in place,
use our free web analytics software.